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Offer or an invitation to treat

On the 29th October 2010, Steven was making an invitation to treat by advertising in the New Focus Paper, “Yamaha Piano latest model, excellent condition, RM15, 000, interested please call 0161234567."

Intention of the parties will determine the advertisement is an offer or an invitation to treat. For instance the case is Majumder v Attorney General of Sarawak. Based on the case above, it is an invitation to treat because the promise is not taken by the Steven in advertisement The word “interested" bring the meaning that he is inviting the other party who are interested to make an offer. Example of an invitation to treat is case of Pharmaceutical Society of Great Britain v Boots Cash Chemists 1952. In the case, the Boots was sue by plaintiff because broken rule by displayed the certain drug in the self-service shop which containing the poison. The drug could only be sold under supervision of pharmacists. However, the Boots was argued that customer was making the offer to them , this is because the customer pick up the drug in a self-service shop. Thus, display drug in the shop is not an offer .Boots say that, it is invitation to treat because it just invite the public the make an offer.

On the 1st November 2010, Tanny is making the offered RM10, 000 to buy the piano from Steven. Based on above situation, Tanny is offeror which mean the party who make an offer. The offer is being made to Steven, so he is call as offeree or promisee. An offer is defined in Section 2(a) of the Contracts Act, 1950 as “when one person signifies to another his willingness to do or abstain from doing anything with a view to obtaining the assent of that other to the act or abstinence he is said to make proposal."

An offer must be clear, define, certain, precise and complete as the piano is sell at RM15, 000 for the latest Yamaha Piano model by giving the contact number, so the people who are interested can contact with the Steven. For example, the case is White v Bluett 1853. At this case, Mr. Bluett lent some money to his son. When he died, his executor, Mr. White sued the son for an outstanding debt and requested him to repay the money. The son said that he needs not to repay the money as long as he would stop complaining the distribution of his father property to the children at the will. The Court claims that the complaints had no economic value and his father had received no real consideration for the promise. Hence, the debt was enforceable at law.

At the same time, “offer must be communicated" according to the Section 4(1) Contracts Act 1950.The case is Taylor v Laird. In the case, Taylor was the captain of the ship that responsible for a trading and exploring voyage but later resigns and just work as an ordinary crew member. He had help to work the ship back home, Britain and claim for his wages. However, he fails to get his wages. The ship owner had yet to receive Taylor offer to help bring the ship home. The owner had received no communication from Taylor offer to work in that position. Based on scenario, Tanny will know what are the selling price, product and so forth that Steven wants to sell through the communication the intention of the Steven towards the Tanny.

There have two kinds of an offer which include the bilateral offer and unilateral offer. Based on the scenario above, the bilateral offer is exist during the offer is made from the Tanny to Steven. Bilateral offer is where the offer is made for the particular person or a group of the person. For example, the case is Powell v Lee. At this case, Powell had applied for the position of headmaster and had been told by one of the school board member that he had successful of getting the job However, the board later changed their mind and had appointed another person to this job. Although one of the board members told him that he was the successfully applicant but that doesn’t mean the acceptance of an offer either by the offeree of the authorized agent. That particular board of member had acted prematurely and without the authority from the school board. Hence, there is no acceptance by the board to Powell’s offer and no contract is form. Powell can’t sue them for the breach of contracts.

In the Section 2(b) Contracts Act 1950, states that “when the offeree signifies his assent to the offer, the offer is said to be accepted." However, Steven does not accept the offer made by Tanny. Thus not acceptance is being made. In the same time, Steven said that he will not sell the piano below RM14, 000 to anyone else before 7th November 2010.

He is said to be making counter offer where the terms of the original offer made by Tanny had been rejected .Steven came out with the new selling price of below RM14, 000.Since, the counter offer had been made by Steven, he is the offeror and he is making a promise to Tanny that he will not sell to anyone else before 7th November in the same year. At the same times, Tanny became an offeree.Thus, the contract is not form among the Steven and Tanny. . A case of counter offer is Hyde v Wrench. In the case, Wrench offered to sell the estate to Hyde for 1200 pounds but the Hyde was rejecting his offer. So, Wrench makes a final offer with a price 1000 pounds to Hyde. Hyde in turn to purchase the farm at 950 pounds and Wrench need some time to consider the offer. After a night, the Wrench rejected the offer and Hyde immediately says that he accepted the Wrench earlier offer by 1000 pounds of real estate. The was not contracts because Wrench refused it .Thus, Hyde sued the Wrench for breach of contract and sought specific performance, contending that Wench’s offer had not been withdrawn prior to acceptance.

On 7th November 2010, Tanny came back to Malaysia from Australia. According to the case Felthouse and Bindley 1862, the acceptances must be communicated to offeror. In the case, P had discussed to buy a horse from his nephew J and the price had been discussed. However on 2 January, P wrote to J again saying that if he hears no more reply from J, P will take that the horse was his at the price of 30.75 pound. J also did not reply and no money was paid yet the horse still remain in the possession of J. J later decided to sell the horse to P thus he told the auctioneer D to withdraw it from the sale. However, D forgot that instruction and had sold the horde to somewhere else. Now, P sued D and claim that the horse was his property. The Court of Common Pleas said that there was no contract exists because P’s letter was an open offer that yet to be accepted. Offeror can’t stated that the offeree silence will be taken as the sign of the acceptance of the offer but he can stated the method by which acceptance should be communicated.

Tanny posted a letter accepting to buy the piano at RM14, 000.Acceptance is taken place as the letter placed in the post box. For instance the acceptance by post is Adam v Lindsell. In the case, when D wrote the letter to P offering to sell him the wool, D had asked P to reply in the post form. However, the letter was delayed two days which resulted in P’s acceptance was going back late to D. Hence, a day before the letter arrived, D had sold the wool to another party. The court decided that P was allowed to claim for the damages as his acceptance was completed once he posted the letter before D had sold the wool to the third party. Postal rule is only applicable to acceptances although the letter was lost or delayed in the post unless it was loss or delayed caused by the acceptor’s error. In this case, D had notified P’s to reply in the post form.

On the 11th November 2010, the letter received by Steven which send by the Tanny on 7th November 2010.However, the selling price of the piano at RM14, 000 only available before 7th November 2010.So, now the decision to acceptance Tanny offer is depend on the Steven because according to Section 5(1) Contracts Act 1950 provide that “the offeror may withdraw his offer at anytime before a proper acceptance has been made." Based on the above scenario, Steven can either choose to withdraw his offer because of the lapse of time or expired the due date which occurs among the Steven and Tanny or accept Tanny offer, so the valid contract will be form. Thus, the Tanny successful purchase the piano at the RM14, 000.If Steven withdraw his offer, the valid contract with not exists among the Tanny and Steven. According to the Section 2(h) Contracts Act 1950, states that “an agreement enforceable by laws."